Technology is a major driver of various economic sectors that includes the real estate industry. I asked Sean Godoy, who, among other roles, is a proptech/innovation advisor, commentator and researcher, the headline question: Are the country’s estate agents/agencies slow in adopting proptech? “It is all relevant I suppose. In general, the SA property industry lags behind certain regions where the proptech story is more established, such as the UK/Europe and the US, where there has been significant success for online estate agencies such as Purple Bricks (UK) and Open Listings (US).”
“However, all regions encounter the same challenges to proptech adoption or any new tech adoption for that matter. These include resistance to change, mindset, inadequate training, lack of knowledge, and supply of accomplished proptech products and services. SA, however, is at an early stage of the proptech story, and has its own unique challenges to consider in addition to these.”
SA challenges
One of those challenges is highlighted by Adrian Zanetti, Director of Hey Jude a business enterprise that produces programmes to help companies - among which are several property agencies - to improve the level of engagement with their customers and employees. “We have a mixed response from agents and franchisees to our proptech solutions, from great enthusiasm to early adoption, but there remains a percentage of those who do not believe that the industry should evolve, nor expand to broader services, through tech.
“Yet, proptech can be revolutionary as has already been proven, even at the most basic level, which agents have largely embraced for facilitating the more mundane tasks such as listing, research, and selling especially where gaps exist between the agent/franchise and buyer/seller.”
What has to change is the mindset because proptech is not simply a couple of tangible things. As systems like the Internet of Things, Virtual Reality, and Customer Relationship Management (CRM) advance further, agents who bury their heads in the sand are likely to find themselves not as effective as their tech-savvy competition. Yet, regardless of how proptech may force change, agents have a justified concern about how it will affect their CRM and marketing, which has always been more physical than tech-driven worldwide.
Godoy believes that customer relations and overall marketing strategies will be enhanced with technology. “We are seeing more sophisticated agency management systems that integrate with key operations such as CRM, client engagement, and marketing, particularly digital marketing. Different marketing channels can be accessed simultaneously for example, and customer engagement can be improved through social media, in line with general consumer trends.”
Zanetti concurs, adding that technology only supports customer-centricity if customers adopt, use, and offer praise for it. “Technology that makes the lives of its users easier, provides relevant content, and makes previous processes better is key. In the end the customer will decide that the more relevant, personal, and agile an agent can be, the greater their chances of implementing a truly customer-centric strategy.”
The thing is, people want more from modern-day estate agents, as they do from all other service/product suppliers. But as much as this is key, they also still want to have the same traditional and physical experiences that the sector has nurtured for decades.
Hybrid models
On one hand, you have, as Godoy points out, consumer preferences that have driven the rise of digital engagement, yet on the other hand, traditional agencies are still in demand.
“Certain of the historic elements of the business may indeed stay relevant to consumers for some time. So, at the moment, I believe there are markets for both digital and traditional agents, and perhaps the sweet spot exists somewhere in between with a hybrid model."
"We must also not forget that property is a physical asset that is usually one of the largest purchases a consumer will make in their lifetime therefore, personal engagement and physically interacting with a property are not going anywhere.”
What could a hybrid model look like? Zanetti says that for estate agents such a model must produce nine key effects: expansion of trust in your brand; allow customers to see beyond the traditional products and services on offer; motivate greater retention; present deeper customer insights; promote loyalty; introduce a greater receptiveness to marketing; enhance current services with relevant content; feel personal and relevant to each customer, and identify new opportunities.
Other key opportunities lie in the backroom operations. Godoy describes how apps like those that allow consumers to follow the live progress of their property transfer process and sophisticated marketing tools, can improve efficiencies within agencies’ internal processes, and add even greater value where these overlap with the consumer experience. “Not every solution needs to be an app, however, but integrated approaches can offer significant benefits and there will likely need to be an online element to this.”
Godoy recommends an investigation into innovative CRM and operational platforms available on the market and looking to established online estate agencies in other countries as case studies. “At each step, the unique characteristics of our property market and consumers should be front of mind though. Virtual property viewings are also a consideration, although it is important to note that a physical inspection will always be important when it comes to property.
“If agencies investigate possible innovations earnestly and practically, and adopt only where a clear case for value-add exists, they will likely be able to compete with online estate agencies robustly and build on their established brands and reputations.”
Where can you find the proptech solutions?
With a hybrid model recommended, that isn’t to say that some of the existing products on the market won’t cater to needs, like Hey Jude from Zanetti’s stable, which is essentially a combination of a digital assistant underpinned by human intuition. As Zanetti points out, any system adopted must be supported by businesses that have the reach and know-how to continuously upgrade platforms, and provide excellent security.
Proptech should be a balance between clever tech and property fundamentals, which, says Godoy, is usually evident in successful proptech innovations. “At times there is a risk that while a product is very clever, it does not consider specific needs or characteristics of the property industry. Agencies should then rely on their own experience and skills to assess the functionality of a potential proptech product and not assume that a new way of doing something is an automatic improvement just because it is digital and looks good.
“The right approach could be asking for unique features or adjustments where needed, or perhaps continuing the search or waiting for new solutions that come from a more mature proptech sector. The consideration of white-label (out of the box) and a bespoke solution (custom-made) should also be noted. Bespoke solutions will usually require significantly more time and money, and need to address a specific and unique need to be worthwhile. White-label solutions are often tried and tested and should be focused on relevant fundamentals of the industry. A good strategy could be to start with a white-label solution, perhaps in steps, and only consider a bespoke solution if the need becomes clear.”
Who is likely to use it?
“The audience is a new generation of customers who do not know a world without tech,” says Zanetti, ‘which means agents need to evolve with customer expectations. Working remotely is here, now, and it’s going to become even more advanced in the future.”
Godoy highlights millennials. “They have started to enter the housing market in earnest and are likely to be responsible for the majority of new consumer trends in the property industry. In my opinion, it is these consumers that are driving 'consumer proptech'.
“Overall, I believe that traditional agencies should be looking for new ways to reach and service all of their clients, and consider how online estate agencies are operating,” Godoy says. “Agencies do not need to change completely, but perhaps innovate where they see a clear value-add or specific area of consumer preferences.”